Use of a Debt Service Fund is required
A)When financial resources are being accumulated for the purpose of paying for capital asset acquisition.
B)When financial resources are being accumulated for the purpose of paying principal and interest when it matures.
C)For all bonded debt service payments.
D)For all debt service payments.

Question

Quizplus · Accepted Answer

A Debt Service Fund is used to accumulate financial resources for the purpose of paying principal and interest when it matures. This ensures that the government or organization is able to make timely payments on their debts as they come due. It is not necessarily required for all bonded debt service payments or all debt service payments, but only for those where financial resources need to be accumulated and managed separately.

Use of a Debt Service Fund Is Required